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Medical Groups Critical of Proposed Tobacco Settlement

Medical Groups Critical of Proposed Tobacco Settlement

July 01, 1997

WASHINGTON--The Marlboro Man's long-anticipated final ride into the
sunset will likely be delayed, as the proposed tobacco settlement that
would ban his image appears to be headed for a long and heated debate.

The provision in the settlement banning the use of humans and cartoons
in cigarette advertising may be noncon-troversial, but numerous other elements
of the settlement are receiving close scrutiny and criticism from medical
and public policy groups--a prologue to the contentious debate the agreement
will likely face in Congress.

The proposed settlement was negotiated by the tobacco industry, seven
attorneys general representing the 40 states that have sued the tobacco
companies for reimbursement of Medicare funds spent on treatment of tobacco-related
diseases, and a group of plaintiff's lawyers. The sole public health group
involved in the negotiations was the Campaign for Tobacco-Free Kids.

The agreement requires the tobacco industry to make concessions on advertising,
labeling, and smoking in public places, and to pay $368.5 billion in the
next 25 years to compensate the states for medical care of smokers, finance
anti-smoking programs, and pay for health care of uninsured children. In
return, the tobacco companies would get protection from class action lawsuits
and limits on punitive damages from individual suits.

Although medical groups are supportive of the document's general goal
of reducing tobacco consumption, experts interviewed by Oncology News International
expressed major concerns about many of the provisions.

Two important sticking points are the restraints the settlement would
place on the FDA's ability to regulate nicotine in cigarettes and the inadequacy
of the penalties for failing to meet goals in reducing underage tobacco
use.

'Paralyzes the FDA'

"The agreement virtually paralyzes the FDA from regulating nicotine
in cigarettes," said John F. Banzhaf III, executive director of Action
on Smoking and Health (ASH), a national nonprofit legal action and educational
organization fighting for the rights of nonsmokers. Mr. Banzhaf led the
successful campaign to ban cigarette commercials on television and to limit
smoking in public places, restaurants, and airplanes.

The FDA currently has the right to regulate nicotine as a drug and cigarettes
as a nicotine delivery system. A federal court decision last spring that
upheld this right is being appealed by the tobacco companies. Under the
settlement, the FDA could immediately reduce nicotine levels and could
ban nicotine from cigarettes in 12 years, but with several significant,
if not prohibitive, restrictions.

The FDA would have to prove that the action--lowering nicotine levels
or banning nicotine--would lead to measurable improvements in health, would
be technologically feasible, and would not create a substantial market
for "contraband or other tobacco products that do not meet the product
safety standard," in other words, a black market.

The FDA's decision would then be reviewed by Congress, and the tobacco
industry would have the right to judicial review of any such action, a
legal process that could take years.

Pennies per Pack?

Critics of the agreement also think that the financial penalties would
not be enough to curb the industry. Although $368.5 billion sounds like
a tidy sum, even divvied up over 25 years, critics speculate that the most
of the money could be raised by increasing cigarette prices. Furthermore,
most of the sum would be tax deductible as a business expense.

As part of the settlement, the tobacco industry would have to take steps
to dissuade underage smoking, and if it does not decrease by 60% in 10
years, the industry would be fined $80 million for each percentage point
short of the goal, with a cap of $2 billion annually.

Critics say, however, that this penalty would amount to only a few pennies
per cigarette pack. In addition, the agreement contains a loophole that
would allow the companies up to a 75% abatement of the penalty if they
could prove to the FDA that they had complied in good faith with the provisions
of the settlement.

"The deal is basically a settlement for a few cents on the dollar,
most of which will be paid by the public and by smokers themselves,"
Mr. Banzhaf said.

Lowell Schnipper, MD, of Beth Israel Hospital, Boston, and chair of
ASCO's public issues committee, also considers the penalties too modest
in light of the industry's enormous profits. He said in an interview that
the document is really a first draft and any legislation that comes out
of Congress could be quite different.

Nothing to Stop Overseas Sales

Mr. Banzhaf noted that "there are no provisions in the settlement
whatsoever to protect 95% of smokers, that is, those who are outside of
the United States."

Dr. Schnipper echoed this concern: "The agreement made no attempt
to address the issue of the export of tobacco products to countries outside
the United States, which to us at ASCO is a significant omission."

In a separate interview, Ernst Wynder, MD, executive director of the
American Health Foundation, also said that a more global viewpoint on tobacco
control is needed and that any settlement should benefit not just US children
but all the world's children. Dr. Wynder, with Evarts Graham, wrote the
landmark paper linking lung cancer and tobacco.

Action on Smoking and Health, the organization headed by Mr. Banzhaf,
is one of some two dozen medical and health advocacy groups sitting on
a panel that is reviewing the agreement for Congress and the White House.

The Koop-Kessler panel, named after its co-chairs, C. Everett Koop,
MD, former US Surgeon general, and David Kessler, MD, former director of
the FDA, does not appear to be in a mood to compromise on these issues.
Dr. Koop has called the plan as it stands "absolutely unacceptable."

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